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Norwegian Gassled natural gas tariff-reduction case to be heard in April 2015

Norwegian Gassled natural gas tariff-reduction case to be heard in April 2015

13 June 2014 10:51
Source:ICIS

Four infrastructure companies with stakes in Norway’s offshore natural gas pipeline network will take their legal challenge against a government planned reduction in transportation fees to a district court early next year, ICIS has learnt.

Silex Gas Norway’s CEO Kurt Georgsen, whose company has a 6.10% stake in the Gassled offshore network, told ICIS the case is scheduled for submission to the Oslo District Court in mid-April 2015.

The decision follows a meeting on 10 June between Ministry of Petroleum and Energy representatives, the Oslo District Court and four of Gassled’s stakeholders that reject the ministry’s plan. At that meeting, the parties agreed a schedule for an oral submission, Georgsen said.

The other three stakeholders challenging the ministry are Solveig Gas Norway, Infragas Norge, and Njord Gas Infrastructure. None were available to comment on Friday morning.

The regulatory amendment to reduce transmission costs, which the ministry proposed in January 2013, aims to promote more exploration and encourage development of new discoveries in opened areas of the Norwegian Sea and the Barents Sea South. The ministry had previously said the lowered gas transport costs would reinforce the competitiveness of Norwegian gas, while also ensuring a reasonable profit for Gassled’s owners ( see ESGM 28 January 2014 ).

However, the four companies disagree and formally issued a writ against the ministry at the beginning of the year challenging the legal basis for the reduction, which the ministry is implementing from 2016.

Georgsen said that such a move would result in the Gassled network losing around Norwegian kroner 34bn (€4.4bn) between 2016 and 2028 – when some pipeline investors’ licences expire.

Two weeks prior to Tuesday’s meeting, ICIS approached the ministry for comment on how the challenge was progressing. A spokeswoman said: “The government has taken note of the fact that four participants in Gassled have initiated legal proceedings. The government has rejected the claims. The main hearing will be scheduled at the court’s discretion”.

No one at the ministry was available to comment about the latest development on Friday morning.

Solveig Gas Norway, which has the second largest Gassled stake at 24.76%, is owned by the Canadian Pension Plan Investment Board, Allianz Capital Partners, and Infinity Investments, which is a wholly owned subsidiary of the Abu Dhabi Investment Authority.

Njord Gas Infrastructure, holds the third largest stake in Gassled at 8.04%, and Infragas Norge holds a 5.01% share.

Gassled’s seven remaining shareholders include some of Europe’s largest producers, which potentially stand to gain from government plans to lower fees for new gas finds. Stakeholders include Statoil Petroleum, RWE Dea Norge, GDF SUEZ E&P Norge, DONG E&P Norge, ConocoPhillips Skandinavia, Norsea Gas, and Petoro, which serves as the licensee for the Norwegian state’s direct financial interest in petroleum activities. Kirsty Ayakwah